State Hospitals Face 2nd Highest Rate Of Federal Penalties Nationwide

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Connecticut fared second-worst in the country in the percentage of hospitals hit with federal penalties for selected quality-of-care measures and in the overall rate of loss of Medicare reimbursements associated with those penalties, new federal data shows.

Eighty-six percent of the state’s 30 acute-care hospitals were penalized under Medicare’s Value-Based Purchasing Program, an incentive program created under the Affordable Care Act to reward hospitals on a number of quality measures related to treatment of patients with heart attack, heart failure, pneumonia and certain surgical issues, as well as patient satisfaction. Overall, the state’s hospitals lost .15 percent of their Medicare reimbursement, compared to a .02 percent average loss nationally, the data shows.

In addition to the penalties on quality measures, 23 Connecticut hospitals lost Medicare funding because of high rates of readmitting patients within 30 days of a hospital stay. Four faced the maximum loss, a 1 percent reduction in funding: Griffin Hospital in Derby, the Hospital of St. Raphael (now part of Yale-New Haven), the Masonic Home and Hospital in Wallingford, and MidState Medical Center in Meriden.

Several hospitals fared well under the new system. Middlesex Hospital in Middletown received a .13 percent bonus on the quality measures and no readmissions penalty; Bridgeport, Danbury and St. Mary’s Hospital in Waterbury also received small bonuses for quality.

Hospital leaders in Connecticut said the value-based formula should not be considered a measure of a hospital’s overall quality, and that hospitals are working together to share best practices to reduce readmissions.

“Even now, as hospitals have all hands on-deck treating patients with the flu, they continue to devote staff time to a major statewide collaborative to improve safety, clinical outcomes and patient satisfaction,” said Dr. Mary Reich Cooper, vice president and chief quality officer for the Connecticut Hospital Association.

She said the value-based program “only measures a small portion of the care delivered by hospitals.  This is the first year the federal government based part of its reimbursement on these measures, and hospitals in Connecticut are committed to improving performance.”

At Middlesex Hospital, Dr. Jesse Wagner, vice president for quality and patient safety, said the new payment system has upped the ante for improvements to patient care that were already underway before Medicare began imposing penalties.

“In the big picture, we don’t really zoom-in on these particular indicators (measured by Medicare), so much as we look for ways to improve the patient experience,” he said. “We made a lot of ‘system fixes’ before the (payment) changes went into effect — because they were the right thing to do, to improve quality and safety and our patients’ experiences.”

Under the value-based program, hospitals receive penalties or incentives based on how well they perform on 12 clinical measures, such as controlling surgery patients’ blood sugar levels or giving them antibiotics, and on eight patient experience measures, including how well doctors and nurses communicate with them and how clean and quiet the hospital is during their stays. Middlesex, like most other hospitals, has a number of committees dedicated to encouraging “patient-centered care,” and has put in place new policies to improve safety for surgical patients.

On readmissions, Middlesex was among seven hospitals that avoided penalties this year; the others are Hartford Hospital, Manchester Memorial Hospital, Rockville General Hospital, Sharon Hospital, William W. Backus Hospital in Norwich, and Windham Hospital. The Hebrew Home and Hospital in West Hartford, which is not included in the value-based payment program, also had no readmissions penalty.

But most hospitals that did well in preventing readmissions did not fare as well on the quality indicators. Hartford, Windham and Sharon all faced penalties of more than .3 percent on the quality measures.

When penalties for quality and readmissions are combined, Yale-New Haven Hospital took the worst hit, losing 1.25 percent of its Medicare reimbursements, according to data compiled by Kaiser Health News. Following close behind were Johnson Memorial in Stafford Springs (a 1.16 percent loss) and St. Raphael’s (a 1.12 percent loss).

Dr. Cooper, of the hospital association, said all of the state’s hospitals are working together to find the causes of readmissions and share best practices for decreasing them. She noted that many of the causes “currently lie outside hospitals’ control and are related to patients’ transitions” to community care providers. Hospitals are working with nursing homes and other providers to improve the transitions, she said, and Connecticut has received federal funding for pilot projects to reduce readmissions.

The federal government tracks 30-day readmissions of patients who are hospitalized for three conditions: pneumonia, heart attacks and heart failure. A readmission is counted, no matter why a patient lands back in the hospital.

The value-based payment changes, which began this month, stem from the federal government’s efforts to hold hospitals financially accountable for what happens to patients. Under the program, Medicare is withholding 1 percent of its regular hospital payments and putting that money into a fund to reward hospitals that score well on the 20 quality measures. While the percentage is small, it could amount to hundreds of thousands of dollars for hospitals with large numbers of Medicare patients.

On average, hospitals in Maine, Nebraska, South Dakota, Utah and South Carolina fared the best on the quality payments, while Connecticut was at the bottom of the list, just above the District of Columbia, the Kaiser Health analysis shows.

The percentage reduction on the quality measures is set to increase gradually over the next four years, until it reaches a maximum of 2 percent in 2017.

On readmissions, Medicare began reducing payments to more than 2,200 hospitals nationwide – including the 23 in Connecticut – in October. The maximum penalty is set to double to 2 percent next October and then reach 3 percent of reimbursements in October 2015.

To view the federal data click here.



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